Despite coming close in July, there is 'not a tremendous desire on either side' to do a deal, sources tell paper.

October 12 2006: 7:31 AM EDT

NEW YORK (CNNMoney.com) -- Efforts by the online search firm Yahoo Inc. to purchase the social networking site Facebook Inc. are not moving forward, according to a report published Thursday.

Citing sources familiar with the discussions, The Wall Street Journal reported that no purchase is imminent of the closely held Facebook because Yahoo has been slow in its efforts to expand and faced such problems as slower advertising growth and a delayed upgrade to its advertising systems.

The two sides have held talks over the course of the year and the companies were close to reaching a deal in July, but there is "not a tremendous desire on either side" to finish the deal, the paper reported.

Yahoo (Charts) has placed the value of Facebook at roughly $1 billion, sources told the paper, and Facebook is not reportedly considering any rival offers at the moment, according to the Journal.

Facebook had 13.3 million U.S. visitors in September, down from 14.8 million in August, the paper reported.

An acquisition of Facebook would put Yahoo in position to take on News Corp. (Charts) in the social networking arena. Last year News Corp. snapped up the popular site MySpace for $650 million.

The deal would also give it greater leverage against rival Google (Charts), which announced earlier this week it would purchase the privately held online video sharing site YouTube for $1.65 billion.